Glossary · Reading the business
Cash Flow Projections
In short
These are forecasts of a business's future cash inflows and outflows, showing its expected liquidity. As a buyer, your lender will require robust projections to prove the business can repay the 7(a) loan.
What it means in a deal
Lenders will scrutinize your cash flow projections, especially for the first 1-2 years post-acquisition. Base them on realistic assumptions, historical performance, and your post-acquisition business plan. Be prepared to defend your numbers, as they directly impact the lender's Credit Risk assessment and your ability to secure the loan.
Official sources
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Cash Flow Projections
- Are there any restrictions on the use of cash flow projections for an SBA 7(a) acquisition loan?
- How does a lender evaluate the reasonableness of a borrower's projections for future revenue and cash flow?
- How does the SBA evaluate the reasonableness of a borrower's projections for future revenue and cash flow?
- How does a lender evaluate the reasonableness of a borrower's cash flow projections for a 7(a) loan approval?
- Can future cash flow or profits from the acquired business count as equity injection?
- How can an SBA 7(a) loan help with ongoing cash flow for my business?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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